Free Cash represents surplus/fund balance carried over from year to year. These funds effectively serve as a rainy day account for Massachusetts municipalities. In 2023, total Free Cash balances across municipalities was $2.6 Billion, up from $490 Million 20 years earlier. Since the COVID-19 Pandemic Free Cash balances have increased by $697 Million, or 36%.
Data depicted below are Free Cash balances segregated by county for municipalities with more than 20,000 residents. This aims to declutter the plots, and exclude municipalities with nominal Free Cash balances. The Y axis also uses a logarithmic scale to reduce skew of large balances held by Boston and Cambridge.
The plots are fully interactive, hover over the chart for values, and click to select a single municipality. Click the “House” icon in the toolbar in the top right of the graph to reset the selection.
While Free Cash balances of any amount are useful to have, they lack the context of how much of a fiscal cushion they provide. Compared to the prior year budget that generated the Free Cash, Massachusetts Municipalities had on average 8.9% of their prior year budget sitting in Free Cash in 2024. Converted to days, this approximately 1 month worth of spending (32 days). Twenty years earlier, municipalities only had 5.6% of the prior year budget in Free Cash (20 days). Both in terms of balances and the runway it provides, municipal health has improved.
Unlike the general trend of Free Cash increasing across municipalities, the amount of Free Cash available compared to their prior year spending shows some differences in municipalities. When factoring in expenses, some municipalities show declines in their percentages due to expenditure growth exceeding Free Cash growth.
Boston’s Free Cash balances are above average in this metric. In 2024, Boston had 12.7% of its 2023 budget in Free Cash, good for approximately 46 days worth of spending.
Like the charts above, this plot is fully interactive. Hover over the chart for values, and click to select a single municipality. Click the “House” icon in the toolbar in the top right of the graph to reset the selection.